Singaporeans settling for smaller houses to combat high residential prices

Most homebuyers have budgets under $1m.

Despite a steady decline in residential property prices in the past months, prices remain too high for most Singaporean homebuyers.

According to iProperty.com’s Asia Property Market Sentiment Report for H2, 45% of respondents indicated that lower price per square foot remained the most important incentive for homebuyers. Smaller unit sizes were a close second, with 40% of respondents choosing a compromise between size and cost.

However, Singaporeans continue to view property as a good investment. 34% of respondents claimed that rental income is the top reason for buying a home, while 29% see property as long-term investments.

Private condominiums continue to be the top choice for 57% of respondents, with terrace houses at 25% and HDBs at 23%. Survey respondents chose price, location and potential ROI as the top three factors when purchasing properties.

“Singaporeans are confident about property and have the money. 17 per cent of respondents have identified budgets above $1 million; 61 per cent have budgeted between $500,000 and $1 million; and 18 per cent have less than a $500,000 budget. The market is now correcting after the rapid rise over the last few years ago, and demand is there at the right price point,” said Sean Tan, iProperty.com Singapore General Manager.